Treasurer blocks CK Infrastructure’s $13bn takeover of APA Group
Canberra has effectively rejected CKI’s $13bn bid for the nation’s biggest gas pipeline operator on national interest grounds.
Treasurer Josh Frydenberg has effectively rejected Hong Kong-listed CK Infrastructure’s $13 billion bid for Australia’s dominant gas pipeliner APA Group, saying he did not think it would be in the national interest.
“I have advised the consortium led by CK Asset Holdings Limited (CK Group) of my preliminary view that its proposed acquisition of APA Group would be contrary to the national interest,” the Treasurer said.
The bid would have created a company that owned the major gas pipelines on both sides of the nation.
Mr Frydenberg said the Foreign Investment Review Board was unable to reach a unanimous recommendation, expressing its concerns about aggregation and the national interest implications of creating such a dominant foreign player in the gas and electricity sectors.
“My preliminary view is not an adverse reflection on CK Group or the individual companies,” he said.
“My preliminary view reflects the size and significance of APA Group.”
He said the view “is not discriminatory against any investor or country.”
Mr Frydenberg went on to note that he intends “to make a final decision under the formal process within two weeks,”
He also said the APA Group (APA) was “a unique company” and owned vast assets.
“It is by far the largest gas transmission system owner in Australia, owning 15,000 km of pipelines representing 56 per cent of Australia’s gas pipeline transmission system, including 74 per cent of New South Wales and Victorian pipelines and 64 per cent in the Northern Territory.”
“It also supplies gas for part of all mainland capital cities’ consumption, gas-fired electricity generation assets and liquefied natural gas exports.”
Some opponents of the deal had raised concerns about the potential Chinese influence on CK, which is owned by Hong Kong’s billionaire Li family.
